S&P 500 and Dow Jones hit new records as Wall Street ends week of Nvidia-fueled rally

The largest retailers online and in real life are relying on a reimagined product to sell: advertising space.

Walmart (WMT) this week confirmed plans to expand its advertising business with the $2.3 billion acquisition of smart TV maker Vizio, using a range of displays to give Walmart and advertisers in-house tools to “connect with customers” (monitoring?) and another surface to boost e-commerce.

Vizio's play aligns with Walmart's aggressive advertising build. The retailer is poised to increase advertising revenue by nearly 40% this year, according to Insider Intelligence forecasts. This is more than any other company.

Among the companies expected to significantly expand their ad sales in 2024, other grocery and retail players seeking higher digital advertising margins — Instacart (CART), Target (TGT), and Amazon (AMZN) — are turning to their platforms via The Internet into another system to direct the user's attention and money. It's a natural evolution for these companies, which have also become powerful search engines, hosts of user-generated content (reviews! usernames!), and content publishers over the years.

Walmart's move to acquire more data and advertising power comes as Amazon has grown its advertising business 27% year over year, according to its latest quarterly report.

The market's respect for big tech companies and desire to transform legacy and digital operations into advertising portals has been revealed in other ways. Next week, Amazon, the No. 3 player in the digital advertising world after Google (GOOG, GOOGL) and Meta (META), will join the elite members of the Dow Jones Industrial Average.

“Reflecting the evolving nature of the U.S. economy, this change will increase consumer exposure to retail as well as other business areas of the Dow Jones Industrial Average.” The Standard & Poor's Dow Jones index said, which runs a 30-stock scale. Or, as S&P analyst Howard Silverblatt put it bluntly on Yahoo Finance Live, the index added Amazon because it “needs to remain relevant.”

Amazon has become an ad-tech giant while the nation's largest retailer is busy transforming itself into a technology company. “Digital advertising is the future of Walmart,” Oliver Chen, a senior research analyst at TD Coin, told Yahoo Finance Live.

Although this may seem a bit silly at first glance, it is another way a company can gain an advantage through vertical integration: owning the store and the billboards. Or in this case, screens that do both.